In a Florida divorce, marital property is divided according to equitable division guidelines. When the property in your divorce is equitably divided, it means that the process will fairly distribute assets and property in a manner that is fair to both parties. Equitable division differs from the community property laws that govern many states. In a community property state, assets are divided equally, 50/50. A judge sometimes must intervene to determine how to divide assets that aren’t easy to divide.
When considering property division cases, the court will review several factors, including:
- Length of the Marriage
- Each Party’s Income and Economic Health
- How Each Spouse Contributed to Each Other’s Education and Career Advancements
- What and How Each Party Contributed to the Marriage
- Any Wrongful Conduct Engaged or Recorded During the Marriage
- Any Waste of Marital Assets
- Any Actions that Improved Marital or Nonmarital Assets
What Is Considered Marital Property?
Couples are often surprised when they realize the whole of what is considered marital property. Once you marry, items, income, and property are considered marital assets. If a couple divorces, they will need to agree on what assets they believe are marital and those that are not. It’s better for everyone if a prenuptial agreement can be used during this phase of the divorce. If a couple doesn’t have one, they will need to negotiate to divide their assets.
Typically, the following items and assets are considered marital property:
- Bank accounts
- Real estate
- Retirement accounts
- IRAs, pensions, 401(k)s
- Stocks, bonds, and mutual funds
- Artwork and other collectible items
What Is Considered Separate Property?
As with most issues in a divorce, what is considered separate property can be debated. Typically, separate property is considered assets that were owned before the marriage, acquired during the marriage as a gift from outside the marriage, or inherited.
Typically, the following items and assets are considered separate property:
- Income from separate property
- Separate assets and debts clearly defined in a prenuptial agreement
- Items purchased with or exchanged for separate property
Separate property issues could become complicated if a couple uses marital assets to contribute to the betterment of an asset that appreciated in value in the future because of the improvements. This frequently happens with inherited property. If the couple uses marital assets to improve an inherited property and the heir sells the property. The increased value can be considered a marital asset that would need to be equitably divided among the spouses.
Property Division Complications
Equitably dividing assets can be a complex task if the assets and liabilities are not straightforward. There are specific instances where assets can be especially difficult to divide. These complications usually develop from inherited property and unique items without a prescribed value.
Common complications can include:
- Commingled Assets: As mentioned in the previous example, marital and nonmarital property can become entangled over the course of a marriage – especially a long marriage or one that involves a long cohabitation. When assets become mixed, they are considered commingled. A judge will need to provide clarification of these assets. The judge will use your records to determine which commingled assets were gifted to the marriage and which the original owner retains or should be compensated from marital assets.
- Valuation Issues: Once assets have been marked as marital and separate property, it has to be assigned a value. Assigning a monetary value is the requirement if assets are going to be equitably divided, and sometimes it’s hard to assign a value to certain assets. When the asset requires it, couples may need to hire a professional to research and determine a fair market value for the asset.
If you are preparing to file for divorce in Florida, equitably dividing your property can be time-consuming and challenging. At Tinny, Meyer & Piccarreto, P.A., we can help you manage the property division phase of your divorce. Call us today at (727) 245-9009 to schedule a consultation.